ATA reports driver turnover for large fleets heads up in the second quarter

In the second quarter edition of its Trucking Activity Report, the ATA said that the annualized turnover rate at large truckload fleets is now at 99 percent, up two percent from the first quarter. This marks the highest point for driver turnover at large truckload fleets since the third quarter of 2012 and is slightly ahead of 2012’s annual rate of 98 percent.

Being able to finding and retaining qualified truck drivers remains challenging, based on data released by the American Trucking Associations (ATA) today.

In the second quarter edition of its Trucking Activity Report, the ATA said that the annualized turnover rate at large truckload fleets is now at 99 percent, up two percent from the first quarter. This marks the highest point for driver turnover at large truckload fleets since the third quarter of 2012 and is slightly ahead of 2012’s annual rate of 98 percent.

“Continued high turnover shows that the market for qualified, experienced drivers remains extremely tight,” ATA Chief Economist Bob Costello said in a statement. “The continued improvement in the freight economy, coupled with regulatory challenges from the changing hours-of-service rule and CSA will only serve to put a further squeeze on the market for drivers. A tight market for drivers will push costs higher for fleets as they work to recruit or retain quality driver.”

The ATA said that turnover at truckload fleets with less than $30 million in annual revenue at 82 percent was flat compared to the first quarter, turnover for less-than-truckload fleets decreased by 9 percent to 6 percent, which the ATA is its lowest level in two years.

As LM has reported, driver turnover and tight capacity are two things that clearly go hand in hand in the trucking industry, especially during the current tight market conditions, spurred on by a relatively slow economic recovery and the December 2010 implementation of CSA, as well as the July 1 changes to truck driver hours-of-service (HOS).

And regulations like CSA and HOS, as well as Electronic On Board Recorders (EOBR) continue to play a major role in carriers’ being hesitant to increase capacity and subsequently hire drivers, which continues to be challenging, as evidenced by ATA’s data.

Projections from freight transportation forecasting consultancy FTR Associates estimate that this problem is likely to get worse and by 2014 the driver shortage could be in the 250,000 range, which Stifel Nicolaus analyst John Larkin said is going to create a capacity shortage which will translate into “fairly sizable rate increases” that might be steeper than what has occurred during the slow growth period over the last couple of years.

While the driver turnover rate, especially for large carriers, remains high, it could reach even greater heights should the economy see material gains.

At the FTR Transportation Conference in late September, Larkin said that strong recruiting is the best way to keep driver capacity utilization at bay. The sophisticated and largest carriers are doing the best to recruit experienced drivers and many also have training programs,” he said. “They are the ones treating drivers the best and getting them home regularly.”

While turnover figures to remain prevalent in the future as it is now, the onset of additional regulations to HOS and CSA, will lead to increased hiring. FTR Senior Consultant Noel Perry said that by the third quarter of 2016 there could be 1.4 million new drivers in the marketplace.

October 9, 2013

About the Author

Jeff Berman, Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman

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